That said.... The amplification caused the demon to grow more powerful than the wizards and it may have driven some of the red wizards insane... However, their traps and alarms were permanently enchanted into the place, it was meant to be a highly secure location. Now run more by a demon than by a red wizard....
The point being, we're not talking a 4th or 5th level caster.. The group of 5 PCs are 9th level, and the casters that put the alarm spells in place have 7th level spells. Based on the NPC generator I used, it put the Red Wizards at 11th -12 th level casters.
I considered the monster vs wizard dc. But, in the moment, I simply thought - At these levels, and the amplified magic that Demon is providing, the alarm spells would detect their intrusions. It was designed to keep the cult's military personell not under the influence of the speed magic separate from the dwarves so that there were no altercations or issues as the dwarves went insane.
And an executive decision that I still reinforce, if it was a more powerful illusion, then, I'd consider it as an all out winner over the alarm spell. I agree, PHB rules don't apply. Classic examples are monsters with legendary abilities such as the vampire. It can move through peoples squares and does not provoke attacks of opportunity... Not something any PC classes can do on a routine basis. Rogues can disengage as a bonus action, but, that's only away from the monster....
There's a lot I like about 5th edition that favors DMs. That said, I do my best to be fair and/or realistic to the players. I felt guilty for not giving in to them, but in this case, I feel the executive decision I made was a realistic and acceptable reaction to an illusion.
